"We do have a vacation policy," he said. "We looked into having an unlimited (vacation) policy, but... it results in people who don’t take any vacation at all."

Instead, Kanies said that Puppet Labs' "honor system" allows its 335 workers to take whatever vacation they want based on the needs of their managers or teams. He said this policy works better than other workplaces that have unlimited vacation policies.

"Pretty much every study says (working) above 55 hours a week and you're not getting more done," he said. "If it's much above that, you're actively working against yourself."

Puppet Labs also saves money by not worrying about vacation, Kanies said. "We spend far less on administrative costs because we don’t have a central HR person keeping track of every single person’s hours and reporting it to management."